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FSA Fines Lloyds Unit for Complaint Mishandling

By

Vladimir Guevarra

May 25, 2011 11:09 a.m. ET

LONDON—Bank of Scotland, Lloyds Banking Group PLC's main banking unit in Scotland, said Wednesday that it will pay customers about £17 million ($27.5 million) as compensation for not properly handling complaints over the bank's sale of several retail-investment products.

The compensation comes after the Financial Services Authority conducted its own investigation and fined the bank £3.5 million for the mishandling of complaints, underscoring the regulator's increasing effort to protect customers from poor banking practices....